Abstract
This article applies the education cost function methodology in order to estimate additional costs associated with black student concentration and with alternative, race-neutral measures of urban poverty. Recent research highlights the continued importance of the role of race in educational outcomes, and how the intersection of peer group effects and teacher-quality distribution serve to simultaneously disadvantage black children attending racially-isolated black schools (Clotfelter, C., Ladd, H., Vigdor, J., 2006; Hanushek and Rivkin, 2007). But some questions persist as to whether race, in-and-of-itself should be considered a relevant factor influencing the costs of providing equal educational opportunity. I replicate cost models originally introduced in the context of school funding litigation in 2006, using data from the state of Missouri from 2001 to 2005, and then estimate updated cost models based on data from 2006 to 2008, including indicators of school district racial composition and also including race-neutral indicators of urban, concentrated poverty. I find substantive differences in the cost model predictions when race variables are included in the model, as opposed to race-neutral alternatives, identifying higher costs to achieve state average outcomes in districts where the majority of enrolled students are Black, all else equal. But, conflicting evidence from the race-sensitive versus race-neutral models, including varied prediction accuracy for individual districts makes it difficult to choose which measures better approximate the true cost drivers of Missouri public schools.